Obama Tries to Break Dem Stalemate on Debt

“This is a chance for the president to lay out his vision on this crucial issue. We welcome his leadership.”

-- Senate Democratic aide discussing President Obama’s meeting with the Democratic members of the Senate today to discuss debt, deficits and budget priorities

As hopes fade for a bipartisan deal on his requested increase of the government’s $14.3 trillion federal borrowing limit, President Obama today will try to unite Senate Democrats behind a fiscal plan.

Obama will meet with the Democratic caucus to talk about a way forward on the stalled debt deal. As it stands, moderate Democrats like West Virginia’s Joe Manchin are taking a hard line on the debt limit and threatening to refuse Obama’s request for more borrowing power without spending curbs.

The current danger for Obama and Senate Majority leader Harry Reid is that the movement for spending caps will continue to gain support among moderates like Manchin.

The cap plan, also backed by Missouri Democratic Sen. Claire McCaskill, would set government spending at about 20 percent of the country’s gross domestic product (5 percent lower than current spending) and force across-the-board cuts if the government exceeds those limits.

With the bipartisan Gang of Six fading from the discussion and the administration’s August deadline for increasing government borrowing approaching, the pressure is growing on Reid and Obama to find a deal that can at least get the support of the Senate’s 53 Democrats.

If Obama and Reid can push a debt hike package through the upper chamber – which means wooing at least seven Republicans to get to 60 votes – they would need only 25 House Republicans to join their Democratic colleagues to extend Uncle Sam’s credit limit. That would greatly reduce Speaker John Boehner’s bargaining power in the deal.

If Obama and Reid can’t synch up Senate Democrats, the president faces a strong chance of either a partial government shutdown in August or deep concessions to get a Republican-backed bill.

An aide to one Red State Democratic Senator told Power Play that the hope today was to get some guidance from Obama on what he will accept in a deal.

“The president has talked about his vision for the future, but we also need to talk about the more immediate concerns. [The debt ceiling request] is an opportunity to have a serious discussion about the nation’s fiscal practices,” the aide said.

Obama has scheduled a similar powwow with Republicans on Thursday, but the demands will be much different for that event. Rather than looking for broad consensus, Obama will be looking for the seven or more defectors he will need to get a debt hike done. With primary challenges awaiting moderates like Richard Lugar of Indiana and Olympia Snowe of Maine, his task will be tough then too.

But unless Obama can help Reid start to build some team unity today, whatever he says to Republicans won’t much matter.

THE PRESIDENT: We have gone above and beyond what was requested by the very Republicans who said they supported broader reform as long as we got serious about enforcement. All the stuff they asked for, we’ve done. But even though we’ve answered these concerns, I’ve got to say I suspect there are still going to be some who are trying to move the goal posts on us one more time.

AUDIENCE MEMBER: They’re racist!

THE PRESIDENT: You know, they said we needed to triple the Border Patrol. Or now they’re going to say we need to quadruple the Border Patrol. Or they’ll want a higher fence. Maybe they’ll need a moat. (Laughter.) Maybe they want alligators in the moat. (Laughter.) They’ll never be satisfied. And I understand that. That’s politics.

-- Transcript of President Obama’s speech in El Paso, Texas calling for a conditional amnesty for illegal immigrants

President Obama has cautioned Americans about “spiking the football” after Navy SEALs killed Usama bin Laden in his squalid Pakistani hideout. But on Tuesday, the president did a bit of an end zone dance on a trip through the Republican stronghold of Texas.

Obama taunted and mocked the GOP in a speech that was billed as an effort to restart a national dialogue on providing conditional amnesty for the illegal immigrants already in the country.

The speech near a border crossing in El Paso, Texas seemed much more like a campaign stop than a policy address as Obama repeatedly engaged with a boisterous crowd and blasted Republicans for demanding additional border security, calling their requests insincere.

The partisan effort was met with denunciations by border-state Republicans and anxiety by immigration activists concerned that the rancorous tone would prevent any deal from being achieved and instead preserving the issue as a way to whip up Latino support in 2012.

Obama then headed up to Austin for a major-donor fundraiser at which he touted the bin Laden killing as evidence of the good work he had been able to achieve in his first term, thanks to the support of his political patrons.

He also called the killing “case in point” of the kind of “change” and “progress” he would deliver.

"It's an interesting coincidence of timing—that he is killed at the same time that you have a model emerging in the region of change that is completely the opposite of bin Laden's model.”

-- White House national security spokesman Ben Rhodes talking to the Wall Street Journal about a planned address by President Obama on the Middle East and Usama bin Laden

The Libyan civil war is heading into something more like tribal slaughter than an Arab Spring. The military/Islamist interim government in Egypt is making hostile noises about Israel and seems unable to protect the country’s Christian minority. And the Assad regime in Syria is preparing a fight to the death against rebels from that country’s Sunni majority.

Discontent seethes in Yemen and Bahrain and the Saudi government is looking to expand its circle of friends beyond the Western world with overtures to China and Russia for new alliances. Oil prices remain high despite a global crash in commodities prices as speculators bet that more disruptions lie ahead.

Iran, ever closer to nuclear power, is cheering the developments, which its leaders believe may turn the region in its favor.

But despite the chilly breezes blowing through the region, President Obama is hoping to use the killing of Usama bin Laden to restore some of the optimism with which the Middle Eastern uprisings were first received in the West.

The Wall Street Journal Reports that Obama is expected to make a major speech about the future of the region before his scheduled European trip at the end of this month. No word on the location of the speech. Obama gave his first address to the Muslim world from Cairo (ironically chosen because of the superb security provided by the police state of now-deposed Egyptian strongman Hosni Mubarak).

While Obama will seek to juxtapose the popular rebellions in the Middle East with the hierarchically organized violence of bin Laden, it remains unclear what the president will have to say about the central conflict of the region.

The U.N. is preparing to recognize the Palestinian Authority – an archipelago of impoverished Arab territories scattered through Israel – as a nation this fall. That will increase the pressure on Obama to either join that movement or stand with Israel against the plan.

Given that the new Egyptian government has helped negotiate a reintroduction of the terror group Hamas into the Palestinian government, the president’s position will be more precarious.

Israeli Prime Minister Benjamin Netanyahu will address Congress on May 24 at the invitation of Speaker John Boehner.

Administration Expands Campaign Against Political Groups

"[C]ontributors wishing to remain anonymous may feel the need to pay sizable gift tax assessments rather than challenge the tax in open court, and on the public record."

-- Tax lawyer Ofer Lion to Politico discussing a new move by the IRS to crack down on payments to independent political groups

The Obama White House is still weighing an executive order targeting the political activities of government contractors, but as Washington remains focused on that fight, the IRS is taking steps to squeeze donors to the kinds of groups that helped Republicans take over the House last year.

According to a new report from Politico’s Ben Smith and confirmed by a Washington-area tax lawyer, the agency has been targeting the donors to organizations like American Crossroads with letters saying that they owe gift taxes on their contributions.

While political contributions like the ones President Obama is raising are tax exempt, contributions to political action groups like Crossroads while unlimited, could fall under the IRS’s rules for gift-giving penalties for contributions of more than $13,000.

Republicans are calling on the president to drop a widely circulated draft order which would force companies seeking government contracts to reveal the political activities of their executives and would bar from federal work any companies that use corporate funds for political action.

Obama and CBS Do Business With Town Hall

“13.79 million”

-- Estimated viewership for CBS’ “60 Minutes” on Sunday, the night of President Obama’s first post Bin Laden killing interview, up 3.2 million from the week before

President Obama continues today with his new practice of participating in media-sponsored town halls, but this time, the event will be closed to the press and not broadcast in its entirety.

Obama has already done sponsored town halls with CNBC and Facebook, a departure from past presidential practice. Though, those events were broadcast live.

But today, Obama will participate in a CBS town hall moderated by anchor Bob Schieffer that the network will broadcast over a period of days, re-cut and re-packaged for different shows. The White House has promised a transcript of the event and the network is planning to post a complete Web version of the event – both on Thursday – but there will be tightly limited press access to the public event.

CBS, which has marketed DVD compilations of Obama’s interviews with “60 Minutes” reporter Steve Kroft, has invested heavily in the Obama brand and Obama has provided tremendous access to the network.

Obama’s decision to again appear with Kroft for his first interview after the killing of Usama bin Laden gave the network’s beleaguered news division a ratings boost. The president’s participation in the sponsored town hall may help keep the post-kill momentum going for the network ahead of the departure of “Evening News” host Katie Couric.

CBS was at the center of an Obama media access controversy earlier this month when the network’s news division opted to withhold the full recording of remarks by the president at a Chicago fundraiser that were accidentally overheard by White House Correspondent Mark Knoller.

And Now, A Word From Charles

“I'm sure the president is sincere about believing in comprehensive reform, which is a way to say amnesty. But do you really think he sincerely believes in what was the premise of the speech today, that the border is secure? You mentioned the GAO report saying less than half of it is under full control of the federal government.”